“Show us the Money” in Customer Experience

by Abraham Venismach

How to get C-level buy-in? In other words, how do you show the value (profitability) of CX?

Question from E. Martin


Hi Martin, This a great question. It’s really the crux of the entire CX Success Summit.

I find it odd that companies have trouble buying into making the Customer’s Experience a priority.

Here are some of the main benefits that I see, then I leave it up to the experts to “Show us the Money” in CX.

Your customers are your greatest asset. Keeping them coming back for more and referring others to you is the fastest, easiest and least expensive way to grow your business. Stan Phelps, my first interview on the CX Success Summit, pointed out that studies show that your customers only know about 20% of what you do!

Studies show that customers know only about 20% of what you do.

 

Here’s a story about that from my past.

The name of our company was Ace Trophy. (Keep this name in your mind as the story unfolds.)

It was a family business. We had engraving, embroidery, and screen printing machines and could put a message and logo on just about anything. Arnold Schwarzenegger was one of our loyal customers for probably 25-30 years.

We had been printing t-shirts for a local radio station for years.  While I was in their office one day, I was asked by the buyer if I could recommend a good trophy shop for them as they needed trophies. I started to laugh and asked, “Do you know what the name of our company is?” The buyer looked at me and with a straight face, said, “Of course! Ace T…..Trophy! My goodness! Of course! You’ve been our t-shirt guy for so long it never occurred to me!” and we both had a great laugh as I took his trophy order.

Customer Experience is about keeping your customer, having them want to buy more and tell others about you.

In other words, the lifetime value of each customer.  Many companies seem to sell like they have a hole in their bucket and they do. They don’t market to their customers. Reducing the Customer churn alone can mean huge revenue to any company at a fraction of the cost it would be to acquire a new customer.

So the next time you count the “beans” starting thinking how much you lose by losing customers.

I don’t know if you saw my riddle on the site yet… but here it is… “Why did the Customer Cross the Road?” Here’s the answer 🙂

Well, that’s my two cents.

Enjoy, Abraham

Now, let’s hear from the experts!

 

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Comments

  • Jeanne Bliss
    January 8, 2018

    Uniting the C-Suite as partners in this work is one of the most overlooked parts of taking on a CX transformation. They need to be engaged before the work begins to accomplish the following:
    1. Connect the work to growth and profitability. Start with customer math – are you keeping more value customers than you are losing?
    2. Have customers rate the reliability of each stage of the journey in front of leaders
    3. Define the actions that CX leadership is.
    4. Assign them actions.

  • Moshe Davidow
    January 8, 2018

    You have to show the value added of the CX. You show the current experience as the baseline, and then show why improving the CX will improve the baseline. Value Added = Benefits/Costs. A great example is complaint management. Most companies do the minimum necessary to handle complaints. As a result they don’t improve the customer experience (and in most cases, according to the Customer Rage 2017 survey, even destroy it). I was able to show an ROI of 177%. That’s Value Added!

  • John DiJulius
    January 8, 2018

    Without Executive Sponsorship, it will just be flavor of the month, program of the year or management by best seller. The very top has to truly believe in this. There are so many case studies demonstrating the significant financial performance superior customer service organizations have over the rest of their competition. Here is one place https://thedijuliusgroup.com/customer-experience-is-more-than-warm-fuzzy-here-is-financial-proof/

  • Nick Bush
    January 8, 2018

    Building on Jeanne’s reply there’s a discipline that CX leads need to develop around linking the stages of the customer journey – including the back-office processes – to hard benefits. Where experience is poor because of inefficient back-office processes then you get a double whammy of cost saving and increased retention (and revenue). If senior management can’t support that financial case then you should press them to state what brings bigger benefits to the bottom line.

  • Shep Hyken
    January 8, 2018

    If you want to sell (almost) anything to the c-suite, you must have numbers attached. They want proof of concept. They want to see ROI. Peter Drucker is often attributed to the quote, “You can’t manage what you can’t measure.” Show the numbers, track past numbers. Use numbers to make your case.

  • January 8, 2018

    Know it, benchmark it and show you are improving it – month on month.
    Big tip
    CX ROI big tip:
    Less than 1:4 look to switch channel / outsource as someone is definitely looking at you
    Between 1:4-1:6 you need quick wins and to find the sweet spots for leverage.
    1:7-1:10 you are in a good position, time now build on it to take performance/results to the next level.
    1:10+ now you are operating at a world class level – you’ll need a strong strategy and great innovation to stay ahead.

  • Chip Bell
    January 8, 2018

    The point has been made to have metrics that support the ROI. It is also important to give the C-suite a graphic picture of “the perspective of their customers.” I was hired to consult a major hospital. No one but the CEO knew what I looked like. I flew in late afternoon and walked all floors of the hospital noting in detail all their CX hiccups. Meeting the C-suite the next morning, I laid out what I had seen. It was a wakeup call and I was hired for a four year culture change effort.

  • Paolo Fabrizio
    January 9, 2018

    Hi Martin, first off you need to clearly the ‘whys’ explaining which business opportunities arise from the adoption of your CX program. Of course you will also support it with number showing either areas of improvements and goals to be met. Choose proper metrics to check progresses and keep your C-Suite engaged: show them quick wins especially in the very first steps of the project.

  • Marco Houthuijzen
    January 9, 2018

    Dear Martin,

    Facts and figures are important to the C-suit. To most C-cuits, “customers” are just a statistic and/or the invisible force that transform (a part of) the marketing budget into sales and profit.
    You need a CX ambassador in the C-suit (where is the Chief Customer Officer?!?). who knows how important the customer Experience is (did you know that C-level managers are ordinary customers too?).

  • shaun@beldinggroup.com
    January 9, 2018

    Very relevant – question!

    I’ve always said that you can get your boss – or a CEO – to buy into anything if you approach it right. You just need to present the information in a way that is meaningful. The most effective way is with a well thought out financial argument, which will be different depending on the organization. e.g., “Improved CX will reduce customer defection by x%. Based on last years’ numbers, this amounts to y$.” Real numbers are persuasive!

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